# J.K. FINANCIAL SERVICES, INC. X-17A-5 (2024-04-10) — Broker-dealer annual report - Company: J.K. FINANCIAL SERVICES, INC. - Form: X-17A-5 - Filed: 2024-04-10 - Period: 2023-12-31 - Accession: 0001100950-24-000002 - CIK: 1100950 - File #: 8-52214 - Type: Broker-dealer - Material weakness: Yes - Auditor: Mercurius & Association LLP - Auditor location: New Delhi 110052, K7 - Contact: Joe Zheng - Phone: 7147041818 - Email: info@kfinancial.net - Website: kfinancial.net - Signed by: Joe Zheng (President) Original filing: https://www.sec.gov/Archives/edgar/data/1100950/000110095024000002/annualauditedreports.pdf --- {0}------------------------------------------------ | UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.20549
ANNUAL REPORTS
FORM X-17A-5
PART III
FACING PAGE
fnformation Required Pursuant to Rules L7a-5, 17a-12, and 18a-7 under the Securities Exchange Act of 1934
FILING FoRTHE pERroD BEGTNNTNG 0110112023
AND ENDTNG
MM/DD/YY
A. REGISTRANT IDENTI FICATION
J K Financial Services Inc
NAMEoFFTRM:
TYPE OF REGISTRANT (check all applicable boxes):
E Broker-dealer I Security-based swap dealer ! wtalor security-based
n Check here if respondent is also an OTC derivatives dealer
ADDRESS oF PRINCIPAL PLACE oF BUstNEss: (Do not use a p.o. box no.)
149 Cross Rail Ln, Ste . 102 | OMB Numbbr:3235-0123
Expires: Nov, ?O,2026
Estimated average burden
hours per response: l2
SEC FILE NUMBER
8-52214
1213112023
MM/DD/YY
swap participant | |----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | (No, and Street) | | | Norco
CA | 92860 | | (city)
(State) | (zip Code) | | PERSON TO CONTACT WITH REGARD TO THIS FILING | | | Joe J Zheng
7147041818 | info@kfinancial.net | | (Name)
(Area Code - Telephone Number)
(Email Address) | | | B. ACCOUNTANT IDENTIFICATION | | | | | | INDEPENDENT PUBLIc AccouNTANT whose reports are contained in this filing* | | | Mercurius & Associates LLP | | | (Name - if individual, state last, first, and middle name) | | | 94lSWazirrpur Industrial Area New Delhi-1 10052 India | | | (Address)
(City)
(State)
3223 | (zip code) | | with PCAO | Number, if | | FOR OFFICIAL USE ONLY | | | tC aimsforexemptionfromtherequirementthattheannua '"pori | | cFR 240,17a-s{eXlXii), if applicabte, Persons who are to respond to the collection of information contained in this form are not reguired to respond unless the form displays a currently valid OMB control number. {1}------------------------------------------------ #### OATH OR AFFIRMATION | Joe J. Zheng | | , swear (or affirm) that, to the best of my knowledge and belief, the | | |--------------|--|--------------------------------------------------------------------------------|--| | | | financial report pertaining to the firm of J K Financial Services Inc
as of | | | 12/31 | | CHILD SOO COMMOnt Studio Comment Comments of | | is true and correct. I further swear (or affirm) that neither the company nor any partner, officer, director, or equivalent person, as the case may be, has any proprietary interest in any account clasified solly as that of a customer. Signature: Title · President Notary Public ### This filing\*\* contains (check all applicable boxes): - (a) Statement of financial condition. - □ (b) Notes to consolidated statement of financial condition. - comprehensive income (as defined in § 210.1-02 of Regulation S-X). - (d) Statement of cash flows. - (e) Statement of changes in stockholders' or partners' or sole proprietor's equity. - □ (f) Statement of changes in liabilities subordinated to claims of creditors. - (g) Notes to consolidated financial statements. - = (h) Computation of net capital under 17 CFR 240.15c3-1 or 17 CFR 240.18a-1, as applicable. - □ (i) Computation of tangible net worth under 17 CFR 240.18a-2. - (j) Computation for determination of customer reserve requirements pursuant to Exhibit A to 17 CFR 240.15c3-3. □ 15 C - | Exhibit A to 17 CFR 240.18a-4, as applicable. - □ (I) Computation for Determination of PAB Requirements under Exhibit A to § 240.15c3-3. - (m) Information relating to possession or control requirements for customers under 17 CFR 240.15c3-3. - | (n) Information relating to possession or control requirements for security-based swap customers under 17 CFR 240.15c3-3(p)(2) or 17 CFR 240.18a-4, as applicable. - (o) Reconciliations, including appropriate explanations, of the FOCUS Report with computation of net capital or tangible net worth under 17 CFR 240.15c3-1, 17 CFR 240.18a-2, or 17 CFR 240.18a-2, as applicable, and the reserve requirements under 17 CFR 240.15c3-3 or 17 CFR 240.18a-4, as applicable, if material differences exist, or a statement that no material differences exist. - □ (p) Summary of financial data for subsidiaries not consolidated in the statement of financial condition. - (q) Oath or affirmation in accordance with 17 CFR 240.17a-5, 17 CFR 240.17a-12, or 17 CFR 240.18a-7, as applicable. □ 1 C - □ (r) Compliance report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - (s) Exemption report in accordance with 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - 口 (t) Independent public accountant's report based on an examination of the statement of financial condition. - (u) Independent public accountant's report based on an examination of the financial report on financial statis. CED 240,17 5, 17,65 17,65 13,65 13,40 7,7 5,0 -CFR 240.17a-5, 17 CFR 240.18a-7, or 17 CFR 240.17a-12, as applicable. - O (v) Independent public accountant's report based on an examination of certain statements in the compliance report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - |(w)ndependent public accountant's report based on a review of the exemption report under 17 CFR 240.17a-5 or 17 CFR 240.18a-7, as applicable. - (x)Supplemental reports on applying agreed-upon procedures, in accordance with 17 CFR 240.15c3-1e or 17 CFR 240.17a-12, as applicable. - ■(y) Report describing any material inadequacies found to exist or found to have existed since the date of the previous audit, or a statement that no material inadequacies exist, under 17 CFR 240.17a-12(k). - [ (z) Other: - \* To request confidential treatment of certain portions of this filing, see 17 CFR 240.17a-5(e)(3) or 17 CFR 240.18a-7(d)(2), as th applicable. {2}------------------------------------------------ CALIFORNIA JURAT WITH AFFIANT STATEMENT GOVERNMENT CODE § 8202 D See Attached Document (Notary to cross out lines 1-6 below) □ See Statement Below (Lines 1–6 to be completed only by document signer[s], not Notary) ্ Signature of Document Signer No. 1 Signature of Document Signer No. 2 (if any) A notary public or other officer completing this certificate verifies only the individual who signed the document to which this certificate is attacted, and matter hal to which this certificate is attached, and not the truthfulness, accuracy, or validity of the newcurant. State of California Subscribed and sworn to (or affirmed) before me County of KINPS M day of \_ Apr 1 , 20 7 9 on this by Date Month Year Doe Jidnkaha 7 MARTIN RAMOS (and (2) \_ Notary Public - California Name(s) of Signer(s) Riverside County Commission # 2334170 proved to me on the basis of satisfactory evidence to My Comm. Expires Sep 23, 2024 be the person(s) who appeared before me. Signature Signature Place Notary Seal and/or Stamp Above Signature of Notary Public OPTIONAL -Completing this information can deter alteration of the document or fraudulent reattachment of this form to an unintended document. Description of Attached Document Title or Type of Document: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Document Date: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ Signer(s) Other Than Named Above: \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ ©2019 National Notary Association {3}------------------------------------------------ #### JK Financial Services, Inc. Financial Statements and Supplemental Schedules Required by the U.S. Securities and Exchange Commission Including Independent Auditor,s Report Thereon December 31"2023 {4}------------------------------------------------ ### J K Financial Services, lnc. Table of Contents To the Audited Financial Statements Forthe year ended December 31,2023 #### Contents | Independent Auditor's Opinion,
,4 | | |---------------------------------------------------------------------|--| | Financial statements
6 | | | Statement of operations,,,,
.,,.,.,,,1 | | | Statement of Cash F1ow
,,g | | | Statement of change in Ownership Equity,
9 | | | Footnotes to Financial Statements
10 | | | Supplementary Information Section,
:,
,17 | | | Supplementary Computations,
1g | | | Computation of Net Capital
,t8 | | | Computation of Aggregate Indebtedness,
1g | | | Computation of Net Capital Requirement
18 | | | Supplementary Statements,
19 | | | Supplementary Related to uniform Net Capital Ru1e ,,19 | | | Supplementary Related to Exemptions (possession and Control)
19 | | | Supplementary Related to Material lnadequacies
19 | | | Supplementary Related to StpC Reconciliation L9 | | | Supplementary Auditor's Report on Exemption Letter
20 | | | Supplementary Customer protection Exemption Letter
22 | | | Suppf ementary Auditor's Agreed upon procedures Report
,,.24 | | | Supplementary Agreed upon procedure Report SlpC Reconciliation ,26 | | {5}------------------------------------------------ J K Financial Services, Inc. In4ependent Auditor's Opinion For the year-ended December 3I,2023 {6}------------------------------------------------ ![](_page_6_Picture_0.jpeg) MERCURIUS & ASSOCIATES LI P Formerly known as AJSH & Co LLP +91 11 4559 6689 12 info@masllp.com \ www.masllp.com Report of the Independent Registered Public Accounting Firm To the Shareholders and Board of Directors of J K Financial Services, Inc. #### Opinion on the Financial Statements We have audited the accompanying statement of financial condition of J K Financial Services, Inc. (the "Company ") as of December 31, 2023 and the related statements of operations, changes in Stockholders' (quite "contracts flows for the year ended, and the related notes (collectively referred to as the "financial statementy"), In caur opinion, the financial statements present fairly, in all material respects, the financial position of the Company as December 31, 2023, and the results of its operations and its cash flows for the year ended, in confedmiby with accounting principles generally accepted in the United States of America. #### Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) ("PCAOB") and are anguired to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are we plan material misstatement, whether due to error or fraud. Our audit included performing procedures to as sness be risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence ceearding the amounts and disclosures in the financial statements. Our audit also included evaluating the ecogniting principles used and significant estimates made by management, as well as evaluating the overall creantion of the financial statements. We believe that our audit provides a reasonable basis for our opinion. #### Auditor's Report on Supplemental Information The supplementary information contained in Schedule I - Computation of Net Capital pursuant to Uniform Net Capital Rule 15c3-1 of Securities and Exchange Commission has been subjected to audit procedures nerformed in conjunction with the audit of Company's financial statements. The supplemental information is the responsibility of the Company's management. Our audit procedures included determining whother the supplemental information reconciles to the financial statements or the underlying accounting and other records, as applicable and performing procedures to test the completeness and accuracy of the information presented in the supplemental information. ![](_page_6_Picture_15.jpeg) LLPIN: AAG-1471 A-94/8, Wazirpur Industrial Area New Delhi-110052, India {7}------------------------------------------------ In forming our opinion on the supplemental information, we evaluated whether the supplemental information, including its form and content, is presented in conformity with Rule 17a-5. In our opinion, the supplemental information is fairly stated, in all material respects, in relation to the financial statements a a holel. Mercurius & Associater LP Mercurius & Associates LLP (Formerly known as AJSH & Co LLP) We have served as the Company's Auditor since 2023. New Delhi, India April 10, 2024 {8}------------------------------------------------ # J K Financial Services, Inc. Statement of Financial Condition December 3I. 2023 | Dec 31.2023 | |-----------------| | (Amounts in \$) | | | | tg7,613 | | 3,040 | | 51,795 | | \$212"\$q | | | | 41,751 | | 82,824 | | 147,330 | | 37,736 | | (242,909) | | \$66,732 | | \$309"170 | | | | | | 812,957 | | \$!2ps7 | | | | 115,000 | | (477,452) | | 6ll,3gg | | 47,266 | | \$2e62!3 | | \$3q9.17p | | | The accornpanying notes are an integril part of these financial statements. {9}------------------------------------------------ # J l( Financial Services, Inc. Statement of Operations For the year ended December 3L, 2023 | | Ordinary Income /Expense | (Amounts in \$) | | |------------|-----------------------------------|-----------------|--| | | Income | | | | | Clearing Commission & Fees | \$98,437 | | | | Mutual Fund Commission & Fees | 79,1 10 | | | | Insurance-Based Commission & Fees | 337,596 | | | | Total Income | \$514"133 | | | | Expenses | | | | | Payroll expense | 78,282 | | | | Commission Expense | 224,229 | | | | Depreciation Expense | 29,g0g | | | | License & permits | 20,425 | | | | Professional Fees | 56,344 | | | | Rent | 27,000 | | | | Office Expense | 6,063 | | | | Automobile Expense | 12,441 | | | | Travel & meals Expense | 24,907 | | | | Insurance Expense | 6,120 | | | | Other general & administrative | 19,427 | | | | Total Expense | \$505.047 | | | | Net ordinary Income | \$ 9,086 | | | | Other Income/Expense | | | | | Interest Income | r,230 | | | | Reimbursed Expense | 36,950 | | | | Total Other lncome | \$38,180 | | | Net fncome | | \$47,266 | | {10}------------------------------------------------ # J l( Financial Services, Inc. Statement of Cash Flow Forthe year ended December 3L, 2OZg | A" Net Income
47,266
B. Non-Cash Expense
Depreciation
29,g0g
Adjustment related to prior years
10,361
Change in Current Asset & liabilities
Decreasei(Increase) in Accounts. Receivables
26,113
(Decrease/Increase in Accounts payable
(21,060)
Decrease(Increase) in Clearing Deposit Account (cunent Asset)
(1,306)
C. Cash flow from operating activities
3,747
D. Net cash used. by operating activities (A+B+C)
--
91.283
E. Cash flow from Investing activities
Vehicle
Q7,736)
F. Cash flow from financing activities
Distribution
p5.09Q)
Cash flow from financing activities
(25.000)
%
Net cash Increase/ @ecrease) for period (D+F+E)
29,547
Cash and cash equivalents at the beginning of the period
t5g,Q66
Cash and cash equivalent at the end ofperiod
187.613 | Cash flow from operation activities | Dec31,2023 | | |----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|-------------------------------------|------------|--| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | The accompanying notes are an integral part of these financial statements. {11}------------------------------------------------ Statement of Changes in ownership Equity For the year ended December 31, 2023 JK Financial Services, Inc. | Total | \$ 263,587 | \$(25,000) | \$ 47,266 | \$ 10,360 | \$296,213 | |----------------------|------------------------------------|----------------------|------------|--------------------------|------------------------------------| | Retained
Earnings | \$ 601,039 | | \$ 47,266 | \$ 10,360 | | | Stock Distribution | \$115,000 \$(452,452) | \$ (25,000) | | | | | Common Capital | | | | | | | Common
Shares | 200,000 | | | | | | | December 31, 2022
Balance as at | Capital Distribution | Net Income | Prior Period Adjustments | December 31, 2023
Balance as at | The accompanying notes are an integral part of these financial statements. {12}------------------------------------------------ ### J K Financial Services, lnc. Footnotes to Financial Statements For the year ended December 37,2023 ### Note l- Organization and Nature of Business JK Financial Services, Inc. (The "Company") is a broker-dealer registered with the Securities and Exchange Commission(SEc) and is a member of the Financial Industry Regulation Authority (FINRA). The Company is Califomia Corporation that incorporated on October 20,lg9g, #### Note 2 - Significant Accounting Policies Basis of Presentation - The Company conducts the following types of business as a securities brokerdealer, which comprises several classes of services, including: .Broker or dealer retailing corporate equity securities over-the-counter .Broker ofdealer selling corporate debt securities l .Mutual fund retailer "U.S, government securities broker .Municipal securities broker .Broker or dealer selling variable life insurance or annuities .Put and call broker or dealer or option writer . Non-exchange member arranging for transactions in listed securities by exchange member (KX2Xii) operating exemption Under its membership agreement with FINRA and pursuant to Rule 15c3(k)(2)(1), the Company conducts business on a fully disclosed basis and does not execute or clear securities transactions for customers. Accordingly, the Company is exempt from the requirement of Rule 15c3-3 under the Securities Exchange Act of 1934 perlaining to the possession or control of customer assets and reserve requirements. Use of Estimates - the preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported {13}------------------------------------------------ ## J K Financial Services, Inc. Footnotes to Financial Statements For the year ended December 3L,2O2g #### (Continued) amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Securities Owned- Profit and loss arising from all securities and commodities transactions entered into the account and risk ofthe Company are recorded on a trade date basis. Provision for Income Taxes - The Company has elected to be taxed under the provisions of subchapter S of the Internal Revenue Code and comparable State of California statues wherein the company's taxable federal and state income is taxed directly to the shareholder. The accounting principles generally accepted in the United States of America provides accounting and disclosure guidance about positions taken by an organization in its tax returns that might be uncertain. Management has considered its tax positions and believes that all of the positions taken by the Company in its Federal and State organization tax returns a.re more likely than not to be sustained upon examination. The Company is subject to examinations by U.S. Federal and State tax authorities from 20 I 8 to the present, generally for three years after they are filed. Depreciation and Amortization- Deprecation is provided on a straight-line basis using estimated useful lives ofthree to seven years. Start-up expenditures are amortized over five years and have been fully amortized and no longer represented in the statement of financial condition. Cash and cash equivalents - the Company has defined cash equivalents as highly liquid investments, with original maturities of less than three months that are not held for sale in the ordinarv course of business. #### Note 3- Fair Value FASB ASC 820 defines fair value, establishes a framework for measuring fair value and establishes a fair value hierarchy which prioritizes the inputs to valuation techniques. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A fair value measurement assumes that the transaction to sell the asset or transfer the liability occurs in the principal market for the asset or liability or, in the absence of a principal market, the most advantageous market.Valuation techniques that are consisted with the market, income or cost approach, as specified FASB ASC 820, are used to measure fair value. The fair value hierarchy prioritizes the inputs to valuation techniques used to measure fair value into three broad levels: Level I inputs are quoted prices (unadjusted) in active markets for identical assets or a liability the Company has the ability to access. {14}------------------------------------------------ F For the Financial Services, Inc. to Financial Statements ended December 3t,2023 (Continued) Level? inputs are inputs ( observable for the asset or than quoted prices included within level 1 that are lity, either directly or indirectly. Level 3 are unobservable i for the asset or liability and rely on management's own assumptions about the asset or liability. (The ions that market participants would use in pricing the Inputs should be developed based on the best information available in data.) circumstances and may include the Company's own The following table presents the Company's fair value hierarchy for those assets and liabilities measured at fair value on a recurri basis as December 31.2023. The Company does not have any urities positions. #### Note 4- Net Capital Requirem The Company is subject to the S Uniform Net Capital Rule (SEC Rule l5c3-1), which requires the maintenance of minimum net capital, both as defined, should and requires that the ratio of aggregate indebtedness to net not be withdrawn" or cash excess 15 to'1. Rule 15c3-1 also provides that equity capital may paid ifthe resulting net capital ratio would exceed lOto l. #### Note 5- Income Taxes As discussed in Note 2 - Sieni Accounting Policies, the company has elected to be taxed as an Scorporation and as such the Com statements. makes no provisions for Federal income taxes in its financial #### Note 6- Exemption from the SEC Rule 15c3-3 The Company is an introducing - dealer that clears all transactions for customers on a fullv disclosed basis with an i securities clearing company and promptly transmits all customer funds and securities to the clearine company, which canies all of the accounts of such customers and and records pertaining thereto pursuant to the requirements ofthe customarily made and kept by a clearing broker or dealer. The maintains and preserves such SEC Rule l7a-3 and l7a-4. as Company also conducts business 74 of SEC Release No. 34-70073 with mutual fund companies, and as such relies on Footnote r this "non-covered activitv. #### Note 7- Clearing Broker Deposit The Company has an agreement \$50,000. The clearing broker depos ith a clearing broker which requires at December 31,2023 was \$51,785 a minimum deposit of {15}------------------------------------------------ ### J K Financial Services, Inc. Footnotes to Financial Statements For the year ended December 3'J.,2023 (Continued) #### Note 8-Operating Lease Commitments In February 2016,the FASB established Topic 842, Leases, by issuing Accounting Standards Update No. 2016-02, which requires lessors to classifr leases as sales-type, direct financing, or operating lease. Topic 842 was subsequently amended by ASU No. 2018-01, Land Easement Practical Expedientfor transition to Topic 842; ASU No. 2018-10, Codification improvements to Topic 842; and ASU No. 2018-ll, Targeted Improvements. The new standard is effective for the CompanyonJanuaryl, 2022, with early adoption permitted. The Company adopted the new standard on its effective date. A modified retrospective transition approach is required, applying the new standard to all leases existing at the date of initial application. An entity may choose to use either (l) its effective date or (2) the beginning of the earliest comparative period presented in the financial statements as its date of initial application. If an entity chooses the second option, the transition requirements for existing leases also apply to leases entered into between the date of initial application and the effective date. The entity must also recast its comparative period financial statements and provide the disclosures required by the new standard for the comparative periods. The Company adopted the new standard on January 1,2022, and uses this as the effective date as our date of initial application.Conseqlently, financial information will not be updated, and the disclosures required under the newstandard will not be provided for dates and periods before January 1,2022. The new standard provides several optional practical expedients transition. The Company expects to elect the 'package of practical expedients', which permits us not to reassess under the new standard our prior conclusions about lease identification, lease classification and initial direct costs. The Company did not elect the use- ofhindsight or the practical expedient pertaining to land easements; the latter notbeing applicable to us. The Company continues to evaluate ceftain aspects ofthe new standard and does not expect the new standard to have a material effect the financial statements or have a significant change in leasing activities. The Company rents office space under an annual lease agreement with an option to renew the lease annually from August 1,2019 to December 31,2023. The Company currently operates pursuant to this one-year renewal. #### Note 9-Related Party Transactions The Company pays the principal owner of the Company a recruiting fee. In2023, no amount was paid to the owner as recruiting fees, #### Note 10-ASC-606 Revenue Recognition Revenue Recosnition The Company adopted ASU 2014-09, Revenue from Contracts with Customerso (codified in ASC 606). The Company recognizes revenue when services are transferred to clients. Revenue is recognized based on the amount of consideration that management expects to receive in exchange for these {16}------------------------------------------------ ### J K Financial Services, lnc. Footnotes to Financial Statements For the year ended December 3t,2023 (Continued) services in accordance with the terms of the contract with the client. To determine the amount and timing of revenue recognition, the Company must (1) identify the contract with the client, (2)identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when the Company satisfies a performance obligation. #### General Securities Transaction Revenue Revenue from contracts with customers includes commissions from retail and institutional broker/dealer clients and is recognized when promised goods or services are delivered to the clientin an amount the Company expects to receive in exchange for those goods or services (i.e., the transaction price). The recognition and measurement of revenue is based on the assessment of individual contract terms between the customer and the clearing affiliate ("Customer Agreement,'). Commissions and related clearing expenses are recorded on the trade date in an amount establishedin the agreement between the Company and the clearing affiliate ("Clearing Agreement"). TheCompany believes that the performance obligations are satisfied because that is the date that theunderlying financial instrument is purchased or sold, the purchaser or seller is identified, the pricingis agreed, and the risk and rewards of ownership or dispossession has occurred and transferred. TheCompany also receives fees charged to the customer pursuant to terms in the in the CustomerAgreement, or shares in the fees charged the customer pursuant to the terms of the CustomerAgreement in an amount set forth in the Clearing Agreement, and might include, but not be limitedto, shared debit interest charges, sweep credit interest earnings, dividend income from operations,and other fees ("Additional Fees"). The Company has no performance obligations to meet to earnthese Additional Fees. The amount of Additional Fees is not known in advance of receipt of astatement from the clearing affiliate and are therefore recorded when a statement is received. ### Investment Company Shares & Insurance-based product Revenue The Company receives revenue from the sale of investment company shares (mutual funds) and Insurance-based products sold via subscription/application or via direct deposit by a customer into their existing investment account. The contract with the customer is set forth in the purchase agreement with terms for commissions paid by the customer established in the accompanyingmutual fund or insurance product prospectus. The Company's portion of the commission paid by the customer, also referred to as a concession for mutual fund products, is established in the Selling Agreement between the Company and the mutual fund or insurance company sponsor ("Sponsor"). The amount of concession varies depending on the class of shareso the amount the client invested with the family of funds (Rights of Accumulation) or intends to invest in the family of funds (Letter of Intent)' Some classes ofshares sold provide for concessions to be received on an on-going basis (i.e., "Trails"). The Company has met its obligation and recognizes revenue when the Company forwards the applications and checks to the fund Sponsor. Customers may make additional investments into {17}------------------------------------------------ ### J K Financial Services, Inc. Footnotes to Financial Statements For the year ended December 3t,2023 (Continued) their investment account without the Company's knowledge, in which case the Company is entitled to a concession or commission based on the amount of investment as set forth in the prospectusand the terms of the Selling Agreement. In such circumstances, the Company has no performance obligation to satisfy and recognizes revenue upon receipt ofnotification ofthe investment by the customer from the Sponsor. #### l2b-t Fee Revenue The Company receives l2b-1 fees from the sale of mutual funds. The amount of 12b-l fees due to the Company is established in the Selling Agreement between the Company and the mutual fund sponsor. There is no performance obligation required to be performed by the Company to earn and recognize 12b-1 fees. The amount of l2b-l fees due to the Company is calculated based on the average assets under management for the period in which the l2b-1 fee is calculated. The Company does not know the amount of average assets under management until receipt of a statement from the mutual fund company sponsor, at which time the 12b-1 fee revenue is recognized and recorded as of the calculation date indicated on the statement. #### Note 1 l-Commitments & Contingencies There are currently no asserted claims or legal proceedings against the Company, however, the nature of the Company's business subjects it to various claims, regulatory examinations, and other proceedings in the ordinary course of business. The ultimate outcome of any such action against the Company could have an adverse impact on the financial condition, results of operations, or cash flows of the Company. If such action were to occur and would be expected to be settled against the favor of the Company, the Company would record the expected cost of such event on its financial statements. #### Note 12- Breakup Fees The Cheng Huang (the "buyer") entered into a Stock purchase agreement ("SPA") with Joe Jiankang Zheng (the "seller'), in which the buyer intended to purchase 100% of equity interest of the company owned by seller. The buyer had to maintain \$ 50,000 as "Break-up fee" to the Escrow Attorney's non segregated IOLTA account (Escrow Account). Upon the execution of the SPA, the Break-up fee would become part of the total purchase price and the buyer shall deposit the remaining balance of the purchase price into the escrow account in accordance with the terms of SpA. In the event that the seller and the buyer have not executed the SPA by the end ofbusiness day of February 06, 2023 for any reason other than the seller's bad faith negotiation of SPA terms, the Break-up fee shall be disbursed to the seller. In case offailure ofthe SPA, the escrow fees shall be paid first before any disbursement of the funds maintained in escrow account. {18}------------------------------------------------ ### J K Financial Services, lnc. Footnotes to Financial Statements For the year ended December 37,2023 (Continued) Later, the deal was not closed due to buyer's inability to purchase the interest of the company andthe attorney disbursed \$ 36,950 to the seller after deduction expenses as agreed. #### Note l3-Prior Period adjustment The management made few enors with respect to the duplication of expenses amounting to \$10,360 which was charged out of the bank in prior periods. The management has rectified the errorsand properly disclosed it in the current period financials. #### Note l4-Subsequent Events Management has reviewed the results of operation for the period of time from its year end through the date of issuance and has determined that no adjustments are necessary to the amounts reported in the accompanying combined financial statements nor have any subsequent eventsoccurred, the nature of which would require disclosure. {19}------------------------------------------------ JK Financial \$ervices,Inc. ### SUpp I,e. mp,nlant In&qr.rpti pn S pqJjqn 'Pursuant to SEA Rule 17a-5 of the securities and Exchange act of 1934As of and for the year ended December 3I,2023 {20}------------------------------------------------ # J K Financial Services, Inc. Supplementary Computations Pursuant to SEA Rule 17a-5 of the Securities and Exchange Act of 1934 As of and for the year ended December 31, 2023 ### Computation of Net Capital | Total Stockholder's Equity | \$296,213 | |-----------------------------------------------------|-----------| | Allowable Subordinated Loans | | | Non-Allowable Assets | (66,733) | | Haircuts on Securities Positions | | | Net Allowable Capital | \$229,480 | | Computation of Aggregate Indebtedness | | | Total Aggregate Indebtedness | \$12,957 | | Percentage of Aggregate Indebtedness to Net Capital | 5.64% | | | | | Computation of Net Capital Requirement | | | Minimum Net Capital Required as a Percentage of Aggregate Indebtedness | \$864 | |------------------------------------------------------------------------|-----------| | Minimum Dollar Net Capital Requirement of Reporting Broker/Dealer | \$5,000 | | Net Capital Requirement | \$5,000 | | Excess Net Capital | \$224,480 | {21}------------------------------------------------ ### J K Financial Services, Inc. SHppJemqUlary Statemql"tp Pursuant to SEA Rule 17a-5 of the Securities and Exchange Act of 1934as ofand for the year ended December 31,2023 #### StatgmenlRelate4 tp Uniform Net Capital Rule The Company is a member of the FINRA and is subject to the SEC Uniform Net Capital Rule 15c3-1. This rule requires the maintenance of minimum net capital and requires that the ratio of aggregate indebtedness to net capital, both as defined, shall not exceed 1500% (15:1), or, during its first year ofoperations, 800% (8:l). Net capital and the related net capital ratio may fluctuate on a daily basis. At December 31,2023, the Companyhad net capital of \$229,480 which was \$224,480 in excess of its required net capital of \$5,000. The Company's ratio of aggregate indebtedness to net capital was 5.64%;o. The Company has elected to use the basic computation method, as is permitted by the rule, which requires that the Company maintain minimum Net Capital pursuant to a fixed dollar amount or 6-213% of total aggregate indebtedness, as defined, whichever is greater, and does not, therefore, calculate its net capital requirement under the altemative reserve requirement method. There were no material differences reported as Net Capital in the audited computation of Net Capital and the broker- dealer's conesponding unaudited Part llA of the FOCUS report required under Rule l5c3-1. ### State4qqt Re1a19d tq Exqr4pttive Frovisio,n (Pospess ion an3\_ Cqnttgl) The Company does not have possession or control of customer's funds or securities. There were no material inadequacies in the procedures followed in adhering to the Company's operating pursuant to 15c3-3(k)(2)(ii) and Footnote 74 ofSEC Release 34-70073. ### Stqte.mgnl Belqted tg \4aJqri.al Inadgquacies This audit did not disclose any material inadequacies since the previous audit of the financial statements in the accounting system or in the internal control related to reporting or the practices and procedures required pursuant to Rule l7a-5. The firm does not maintain customer funds or securities and, therefore, does not maintain customer funds to segregate nor does it maintain separate accounts for customers. ### Stateme"nlRelated 1o SIPC Reco.nqiliatioq SEA Rule l7a-5(eXa) requires a registered broker-dealer not exempt from SIPC membership with gross revenues exceeding \$500,000 to file an Agreed Upon Procedures Report (AUP Report). SIPC members with gross revenues below \$500,000 are not required to file an AUP Report. Broker-dealers exempt from SIPC membership must file a Form SIPC-3 and are required to file an AUP Report. If an AUP Report is required to filed with SIPC, such report may be filed separately or included within this Supplemental Information section. {22}------------------------------------------------ #### SupJrlemenIary Auditpr's Rgport on Exemption Letter Pursuant to SEA Rule 17a-5(dxlXD@X2) of the securities and Exchange Act of l934As of and for the year ended December 31,2023 {23}------------------------------------------------ ![](_page_23_Picture_0.jpeg) MERCURIUS & ASSOCIATES LLP Formerly known as AJSH & Co LLP > ell +91 11 4559 6689 info@masllp.com www.masllp.com Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors of J K Financial Services, Inc. We have reviewed management's assertions, included in the accompanying J K Financial Services, Inc. Exemption Report, in which: (1) The Company identified 17 C.F.R. § 240.15c3-3(k)(2)(ii) as the provision under which the Company claimed an exemption from 17 C.F.R. § 240.15c3-3 (the "exemption provision") for the fiscal year ended December 31, 2023. (2) The Company stated that it met the identified exemption provisions in 17 C.F.R. §240.15c3-3(k)(2)(ii) throughout the most recent fiscal year without exception. (3) The Company states that it is also filing its Exemption Report because the Company's other business activities contemplated by Footnote 74 of the SEC Release No. 34-70073 adopting amendments to 17 C.F.R. § 240.17a-5 are limited to effecting securities transactions via subscription basis and the Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (2) did not carry accounts of or for customers; and (3) did not carry PAB accounts (as defined in Rule 15c3-3) throughout the most recent fiscal year without exception. The Company's management is responsible for the assertions and for compliance with the identified exemption provision throughout the year ended December 31, 2023. Our review was conducted in accordance with the standards of the Public Company Accounting Oversight Board (United States) and, accordingly, included inquiries and other required procedures to obtain evidence about the Company's compliance with the provisions of 17 C.F.R. §240.15c3-3(k)(2)(ii) and Footnote 74 of the SEC Release No. 34-70073. A review is substantially less in scope than an exxmination, the objective of which is the expression of an opinion on management's assertions. Accordingly, we do not express such an opinion. Based on our review, we are not aware of any material modifications that should be made to management's assertions referred to above for them to be fairly stated, in all material respects, based on the provisions set forth in paragraph (k)(2)(ii) of 17 C.F.R. § 240.15c3-3 under the Securities Exchange Act of 1934 and Footnote 74 of the SEC Release No. 34-70073. Mercurius & Associates LLP (Formerly known as AJSH & Co LLP) New Delhi, India April 10, 2024 ![](_page_23_Picture_17.jpeg) LLPIN: AAG-1471 A-94/8, Wazirpur Industrial Area New Delhi-110052, India {24}------------------------------------------------ # J K FINANCIAL SERVICES, INC Member: FINRA, SIPC # March 29,2024 To Mercurius & Associates LLP Re: L7 C.F.R. 5240.15c3-3(k) J K Financial Services, Inc. (the "Company") is a registered broker dealer subject to Rule t7a-5 promulgated by the Securities and Exchange Commission (L7 C.F.R. 9240.17a-5,,,Report to be made by certain broker and dealers"). This Exemption Report was prepared as required by 17 c.F.R. 9240.L7a'5(dx1) and (4). To the best of its knowledge and belief, the company states the following: L. The Company claimed an exemption from 17 C.F.R. 5240.15c3-3 under the following provision of L7 C.F.R. 5240.15c3-3(K):(kX2)(ii) 2. The Company met the identified exemption provision in L7 C.F.R. 5240,15c3-3(K)from January A!,l}Z3,through December 3L, 2023, without exception. 3. The company is also filing the Exemption report retying on the footnote 74 of the sEC Release No; 34-70073 adopting amendments to j.7 c.F.R. S}4e.t7a-5 because the Company limits the business activity exclusively to effecting securities transactions via subscription on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company. The Company (1) did not directly or indirectly receive, hold, or otherwise owe funds or securities for or to customers, (other than money or other consideration received and promptly transmitted in compliance with paragraph (a) or (b)(2) of Rule 15c2-4 and/or funds received and promptly transmitted for effecting transactions via subscriptions on a subscription way basis where the funds are payable to the issuer or its agent and not to the Company); (2) did not carry accounts of or for customers; and (3) did not carry PAB accounts (as defined in Rule 15c3-3) from January 0L, 2023 through Decemb er 3!,2023 without exception. J K Financial Services, lnc" l, Joe Zheng, affirm that, to my best knowledge and belief, this Exemption Report is true and correct. Jwil,\*ng Joe Zheng President > 149 Cross Rail Lane, Ste. L02, Norco, CA 92860 Tel:(7 t4l7 O4-1818, Fax:(8 66l9t7 -46L8 {25}------------------------------------------------ J K Financial Services, Inc. Supplementary Auditor's Report on Exemption Letter Pursuant to SEA Rule 17a-5(d)(1)(i)(B)(2) of the Securities and Exchange Act of 1934As of and for the year ended December 31, 2023 {26}------------------------------------------------ ![](_page_26_Picture_0.jpeg) MERCURIUS & ASSOCIATES LLP Formerly known as AJSH & Co LLP - 1 +91 11 4559 6689 - info@maslip.com - www.masllp.com #### Report of Independent Registered Public Accounting Firm To the Shareholders and Board of Directors of J K Financial Services, Inc. We have performed the procedures included in Rule 17a-5(e)(4) under the Securities Exchange Act of 1934 and in the Securities Investor Protection (SIPC) Series 600 Rules, which are enumerated below on the accompanying General Assessment Reconciliation (Form SIPC-7) for the year ended December 31, 2023. Management of J K Financial Services, Inc. (the "Company") is responsible for its Form SIPC-7 and for its compliance with the applicable instructions on Form SIPC-7. Management of the Company has agreed to and acknowledged that the procedures performed are appropriate to meet the intended purpose of assisting you and SIPC in evaluating the Company's compliance with the applicable instructions on Form SIPC-7 for the year ended December 31, 2023. Additionally, SIPC has agreed to and acknowledged that the procedures performed are appropriate for their intended purpose. This report may not be suitable for any other purpose. The procedures performed may not address all the items of interest to a user of this report and may not meet the needs of all users of this report and, as such, users are responsible for determining whether the procedures performed are appropriate for their purposes. The sufficiency of these procedures is solely the responsibility of those parties specified in this report. Consequently, we make no representation regarding the sufficiency of the procedures described below either for the purpose for which this report has been requested or for any other purpose. The procedures we performed and the associated findings are as follows: - 1. Compared the listed assessment payments in Form SIPC-7 with respective cash disbursement records entries noting no differences; - 2. Compared the Total Revenue amounts reported on the Annual Audited Report Form X-17A-5 Part III for the year ended December 31, 2023, with the Total Revenue amounts reported in Form SIPC-7 for the year ended December 31, 2023 noting no differences; - 3. Compared any adjustments reported in Form SIPC-7 with supporting schedules and working papers noting no differences: - 4. Recalculated the arithmetical accuracy of the calculations reflected in Form SIPC-7 and in the related schedules and working papers supporting the adjustments noting no differences; and - 5. Compared the amount of any overpayment applied to the current assessment with the Form SIPC-7 on which it was originally computed noting no differences. ![](_page_26_Picture_15.jpeg) {27}------------------------------------------------ We were engaged by the Company to perform this agreed-upon procedures engagement and conducted our engagement in accordance with attestation standards established by the AICPA and in accordance with the standards of the Public Company Accounting Oversight Board (United States), We were not engaged to, and did not conduct an examination or a review engagement, the objective of which would be the expression of an opinion or conclusion, respectively, on the Company's Form SIPC-7 and for its compliance with the applicable instructions on Form SIPC-7 for the year ended December 31, 2023. Accordingly, we do not express such an opinion or conclusion. Had we performed additional procedures, other matters might have come to our attention that would have been reported to you. We are required to be independent of the Company and to meet our other ethical responsibilities in accordance with the relevant ethical requirements related to our agreed-upon procedures engagement. This report is intended solely for the information and use of the Company and SIPC and is not intended to be, and should not be, used by anyone other than these specified parties. Anou all Mercumus g Mercurius & Associates LLP (Formerly known as AJSH & Co LLP) New Delhi, India April 10, 2024 {28}------------------------------------------------ ### J K Financial Services. Inc. Pursuant to SEA Rule 17a-5 (dXlXiXB)(2) of the Securities and Exchange Act of 1934 As of and for the year ended December 31,2023 ### SIPC 7 Recgnciliation | Total Due - SIPC 7 | | \$ 123 | | |--------------------|-------------------------------------------|----------|--| | | | | | | | | | | | | | | | | Paid with SIPC 6 | \$ 54, Plus \$5 Interest or fee, 31612024 | | | | Paid with SIPC 7 | \$69 | 3t7t2024 | | | Total paid | \$123 Plus \$5 Interest or fee | | | Rgc.opqili,a1i.o.n Di.tference (Ovgr P?yrqent ) Underpayment \$0 Source: SEC EDGAR via Adviser Search (https://search.stillhousedata.com). Agents: see https://search.stillhousedata.com/llms.txt.